Business Services

Unveil and recover hidden shipping costs

Uncovering hidden money

Here are three areas professional services firms can examine to rein in expenses.

Your client wants the contract/ad copy/financial statement pronto. And you're committed to delivering. But higher client expectations and smaller staffs make controlling costs and improving efficiency daunting tasks.

Take control of hidden costs by checking three places: inefficient labor, unnecessary expediting and unrecovered areas.

Shipping costs remain a cost-cutting opportunity that has yet to be fully realized by many professional services firms. Perhaps your firm has negotiated rates, but that's only a small portion of the total shipping cost. There's an even greater opportunity for savings in less obvious areas.

Know where to look

Take control of hidden costs by checking three places: inefficient labor, unnecessary expediting and unrecovered areas.

In many firms, shipping is a decentralized, manual process. A staffer looks up the client's address and client/matter reference numbers and then types the information into a shipping air bill, retaining a copy for client billing records. Later, the accounting department rekeys the same information into a database for reconciling and invoicing to the client. When there is a question about the delivery status of a package, more time is spent researching and manually tracking the package. As the volume of packages increases, the time spent in this manual shipping process adds up.

"Manually tracking and billing packages wastes valuable time that should be spent on delivering better quality service to your clients," says Alex Ortolano, UPS marketing director for the professional services segment. "You need to understand what 'pronto' really means to your client."

Unnecessary expediting costs your firm money. Here's why. UPS offers three distinct overnight services with delivery by 8 a.m., 10:30 a.m. and 3 p.m. Within this seven-hour window, the cost differential ranges from 20 to 50 percent. Your savvy clients may question the need for an 8 a.m. delivery and its higher costs and refuse to pay your firm unless you can justify it. Often, your firm simply absorbs the costs because no justification existed or one was not recorded. To counter this, put in guidelines for when to use which service level.

The third factor driving up professional services shipping is unrecovered costs. Firms pass through costs to clients, but sometimes shipping costs are not properly allocated. Sometimes, the costs of personal staff shipments are overlooked. At a typical law firm, for instance, personal shipments are estimated to account for 10 to 15 percent of total shipments. Without a separate billing procedure for personal shipments, there is little chance to recover these expenses.

Decentralize shipping without losing control

These hidden shipping costs can be recovered by automating and decentralizing the shipping process at your firm. Replace the age-old, error-prone processes of manually creating shipping labels, tracking packages and billing shipments with an integrated workflow.

Focus on choosing the right shipping mode to meet your client's needs in the most economical way. Request automatic e-mail notifications from UPS to let your client know when a shipment has been initiated, when it's scheduled to be delivered and whether delays happen along the way.

Innovative, web-based shipping solutions like UPS CampusShip® can help reduce mistakes, improve accountability, and lead to more informed business decisions. This system saves labor time, lowers costs and reduces unallocated client invoices. And with UPS CampusShip, the administrator can set parameters so controls on spending can be established.

Using CampusShip, you can link every shipment to a client/matter code so the shipment is properly allocated and billed. Employees can use the systems to conveniently ship at the office using their personal credit cards. Staff and clients can easily track shipments. Once you've automated and decentralized the shipping process, look at how to reallocate staff to value-added work instead of monitoring shipments and reconciling shipping data.

Learn more about these solutions, including how Paul Hastings, a leading international law firm, stopped shipping profits from going out the door.


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